Financial Daily from THE HINDU group of publications
Sunday, Jun 27, 2004
Financial Daily from THE HINDU group of publications Sunday, Jun 27, 2004 |
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Infrastructure Info-Tech - Telecommunications Corporate - Announcements Sterling Info to invest Rs 500 crore in IT infrastructure in Chennai Our Bureau
Chennai , June 26 STERLING Infotech, which sold its mobile telephone business to Hutchison Essar for an enterprise value of Rs 1,630 crore, plans to invest Rs 500 crore on creating infrastructure on the outskirts of Chennai for information technology, according to Mr C. Sivasankaran, Chairman of the Sterling group. He told Business Line today over telephone from California, US, that the new business would come up under the banner of Sterling Infotech. The company had acquired three acres of land in Porur, on the outskirts of Chennai, for this venture and work would start next month. The plan is to provide the infrastructure - office space, bandwidth and employees - that an IT entrepreneur would require to start a business, he said. If a person wants to start a business, he or she will need to look around for office space, get bandwidth and professionals to execute the work. Instead, Sterling Infotech's project will provide all these facilities and the person using them will only need to pay for what is used. Mr Sivasankaran said this would enable the IT entrepreneur to concentrate on the job on hand rather than worry about things that were essential for the business, but which consumed a lot of the entrepreneurs' time. Such a concept was successful in the Bay Area in California. He said the group would spend Rs 3,000 crore over the next six years in providing mobile phone connections in the North and East. It hoped to cover about 100 million people who did not have access to mobile phones now and would only charge them for the talk time. There would not be any monthly charges, he said. Another project that the company was working on was to bring High Definition Television (HDTV) to India. The company estimated that the market for this in India was at least three lakh families now, he said. Asked about the deal with Hutchison Essar, Mr Sivasankaran said the two companies - Aircel Ltd with operations in Tamil Nadu circle and Aircel Cellular Ltd with operations in Chennai circle - were sold for a combined enterprise value of Rs 1,630 crore. The two companies had a total debt of Rs 430 crore. While Sterling held discussions with Bharti Televentures, Idea Cellular and Hutchison, it sold to Hutchison because it was an all-cash deal. Mr Sivasankaran said Bharti was not prepared for an all-cash deal while Idea Cellular had to get a lot of approvals.
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